Car mechanics

[Barney]

My second example comes from your own experience when you were 22 years old. You worked as a car mechanic, and got very frustrated because your bosses always made you replace parts rather than fix the existing parts. Why? Because the customer would have to pay more for a new part than for a fixed part, even if a fixed part would be better for the customer. Capitalism is powerless to help in this instance. If another car mechanic offered to fix parts where that was better than replacing them, they wouldn't make enough money and would fold, but the part-replacing mechanic would survive. Capitalism prevents businesses from caring most of all about their customers, and instead drives them to care about making money instead.

If it was cheaper to fix a part rather than replace it, then the fixing mechanic can make a repair at a lower cost than the replacing mechanic. Everything else being equal, the fixing mechanic will win and all replacing mechanics will go out of business because they can't compete at that price point. Everything else is not equal. If the fixing mechanic replaces, let's say, just the failed bearing in the alternator, the risk is that the rest of the alternator is old and some other piece of it fails soon after. Let's say the other bearing goes out, it's just as old as the original. Now the customer has to come back for what appears to be the same problem. The mechanic is not looking so good anymore. The second bearing is replaced. Now the diodes go out. Back with the same problem. Now the diodes have been replaced. Next the brushes wear out. etc etc. Perhaps it was best for the customer to just replace the whole alternator up front. Maybe the mechanic doesn't want the reputation for "cutting corners". Maybe it's not worth the reputation hit to fix a part maybe the thing to do is get new OEM parts and replace whole systems when one little part fails. It really depends on what the customer wants and what the risk is. Capitalism says, yep, figure out what you want to do.

Capitalism prevents businesses from caring most of all about their customers, and instead drives them to care about making money instead.

Not at all. If all the customers hate their mechanic the mechanic will go out of business. Business HAVE to care for their customers. It is only government run programs like the department of motorvehicles (DMV) that can afford to gain such universal contempt from people and continue to exist. No business would survive if it was managed like the DMV or many other government operations.

Don't car mechanics have a reputation for being slippery with the truth? For selling you a second hand car that is about to fall apart, or for replacing more parts than necessary so they can charge you more? In England they do. If it was true that only the most servant-hearted car mechanics survived, then they would have a reputation for always telling the truth and for only replacing the parts that needed replacing.

The problem had to do with trust and expertise. I don't know anything about cars, nor can I afford a new one. So I have to depend on the advice of the second hand car salesman, who may or may not be trustworthy. The reason his business survives is that everyone has to depend on his advice. Sure, I might warn my friends not to go to person X because he ripped me off. But I don't know enough people. His business survives, even though it rips people off, because there are so many people who don't know each other, they keep coming to him.

And car mechanics are far from the only example. I just picked one that you had your own experience of. I could use a similar case study in website design, which I worked in for a long time.

[Ondrej]

Don't car mechanics have a reputation for being slippery with the truth? For selling you a second hand car that is about to fall apart, or for replacing more parts than necessary so they can charge you more?

Oh yes, absolutely. The reason I detailed it all out is because it is not so straight forward as the customer thinks. Do they replace more parts than necessary so they can charge you more or do they charge you more because they replaced more parts (and replaced more parts than "necessary" to uphold their reputation as a quality mechanic)? The truth is the customer wants the problem to go away, has no idea what the problem is, has no idea how to evaluate what would be best for them in their financial situation, and really doesn't want to pay anything. On top of that the mechanic can really only diagnose what is currently wrong and has to speculate on what might go wrong in the future based on how things appear to him.

This is not to say that there aren't swindlers. There are. But you can easily cast the honest mechanics as swindlers too when they just replace the failed part and you end up back there with a similar problem down the line. He's just trying to get more money out of me. He should have fixed it properly the first time. The reason I quit working as a mechanic is that nobody appreciates your work unless you do it for free and, in my humble opinion, the pay isn't worth it anyway.

So my guess is that the price of a mechanic will continue to increase despite the reputation, or maybe because of the reputation. If nobody likes their mechanic people will be discouraged from going into the profession. Scarcity of workers will bid up the wages. If you don't like the price, learn to fix it yourself. And I really hope people do because cars are getting increasingly difficult to work on. If the people who bought cars actually worked on them perhaps the manufacturers would have an incentive to pay more attention to serviceability. As it is, the car buyer pays no mind to serviceability because that's the mechanic's problem. So the manufacturer caters to the customer, not the mechanic. As a result, many engineering choices make repairs more difficult and end up prematurely salvaging the car (because of the cost of repairs). This cost is absorbed by the insurance companies in large part. So the customer just sees expensive car insurance and expensive mechanics bills and never makes the connections as to what is going on and doesn't have the expertise to help make a purchasing decision even if he wanted to.

So who is greedy and at fault? Well, nobody really. Things fall apart and have to be maintained. Cars are expensive to build and hard to make reliable. For my part, nobody was thankful when I fixed their car, so I quit doing it.